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Social Capital and SME’s: A Study on Lakes District Enterprises

Murat Ali Dulupcu, Ýlker Hüseyin Çarikci, Gökhan Özdamar and Hakan Demirgil
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Murat Ali Dulupcu: Süleyman Demirel University
Ýlker Hüseyin Çarikci: Süleyman Demirel University
Gökhan Özdamar: Süleyman Demirel University
Hakan Demirgil: Süleyman Demirel University

A chapter in Proceedings of the International Conference on Human and Economic Resources, 2006, pp 33-42 from Izmir University of Economics

Abstract: The rapid change in technologies and markets (innovations) as well as government policies has induced firms and localities to take collective actions to enhance their capacity to adapt and respond to uncertainty (Lundvall, 1998). In this regard current approaches to economic development draw upon diverse theoretical fields and concepts but there is some agreement as to the importance of social capital (Coleman, 1988; Putnam, 1993; Sabel, 1993). Social capital refers to embeddedness of trust and strong civic relations in a locality that serves as a source of competitiveness through cooperation. The SME’s are, naturally, both creators and users of the social capital in a locality. It is observed that different regions perform different qualities in the creation and exploitation of social capital in Turkey. Thus, this study aims to analyze and identify the attitudes of the SME’s towards networking, trust and collaboration in Lakes District (Isparta and Burdur Provinces) in order to assess the social capital capacity and capability. Is there a certain level networking among SME’s? Do they trust each other in their local business environment? Do they trust other local actors such as business chambers and local authorities? Is there awareness about collaborative business development among SME’s? The findings of such questions will help policy makers to design effective strategies in order to improve the role of social capital in economic development process. This study depends on a survey conducted in 2005. 66 SME’s were chosen from KOSGEB’s regional data inventory which includes 250 SME’s for Lakes District. In this survey, 50 questions questionnaire was used. The data collected have been evaluated by SPSS and MINITAB. In order to explore the social capital attitudes and differences among the SME’s, discriminant analysis, t-test and ANOVA are used. The social capital was categorized into (i) supportive structure of local actors (ii) collaboration among SME’s (iii) trust at different levels. The initial findings are less supportive of a strong social capital among SME’s and between SME’s and local actors. It is expected that informal and social relations should have been much developed in less developed economies, mainly as a consequence of less capitalization of social processes. Ironically, strong social relations in developing countries are not enough to produce/reproduce social capital. Referring to Putnam (1993), trust and civicness can be assumed as more compatible producers of the social capital (Keating, 2001) instead of strong social relations.

Keywords: social capital; SMEs; networking; Turkey (search for similar items in EconPapers)
Date: 2006
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